Retail sales plummeted by 3 percent in February, according to a report released Tuesday by the Census Bureau, as extreme winter weather kept people at home.
The Monthly Retail Trade report released on Tuesday found that retail sales dropped by a seasonally adjusted 3 percent in February, after rebounding by 7.6 percent in January.
However, when compared to February of last year, retail sales have risen by 6.3 percent, indicating an overall improvement in the last year.
Commerce recorded about $561.7 billion in retail sales in February, according to the report.
The drop in sales reflects not only the impact of the weather but also the declining effects of the $600 stimulus checks that were approved in December.
“The February data are in the context of the January surge on consumer spending in goods,” U.S. HSBC economist Ryan Wang told The Wall Street Journal. “In some sense, even a modest decline would still leave consumer spending, especially on goods, up substantially since the turn of the year.”
As coronavirus vaccine administration continues to expand, consumers are beginning to feel more confident in their spending.
The recently passed $1.9 trillion coronavirus relief bill is also expected to help in boosting sales, as $1,400 stimulus checks have already started to go out. The bill also expands the Payment Protection Program (PPP) for small businesses, adding $15 billion in emergency grants.
Some households may also be in better positions to spend money. Reuters notes that U.S. households have accumulated $1.8 trillion in excess savings. A study from WalletHub released last week found that Americans paid off $83 billion worth of debt last year.
In February, 379,000 jobs were also added to the economy according to the first job report released under the Biden administration, jumping up from the 49,000 jobs added in January and more than double the amount of jobs that economists had predicted.